DALLAS - Aug. 11, 1999--Wyndham International, Inc. (NYSE:WYN)
today reported earnings before interest, taxes, depreciation and amortization
(EBITDA), as adjusted, of $165.4 million for the quarter ended June 30,
1999, compared with $147.1 million for the comparable 1998 period. Revenues
rose nearly 40% in the quarter to $651.2 million from $465.5 million the
prior year quarter.
As expected, Wyndham�s results in the quarter included $893.8 million
in non-recurring, largely non-cash charges associated with its recent restructuring,
including $675 million for deferred taxes as it converted from a REIT to
a C corporation and $201.8 million for
expenses related to restructuring and strategic reorganization. Other
non-recurring charges in the quarter reflect the announced sale of Arcadian
International Limited�s historic-style hotels, severance, and goodwill
relating to the disposition of certain non-strategic assets.
As a result, Wyndham reported a net loss for the quarter of $877.2 million,
or $5.76 per share diluted, compared with a net loss of $26.3 million,
or $0.21 per share in the prior year.
James D. Carreker, Chairman and Chief Executive Officer of Wyndham,
said: �We continue to outperform the industry averages for RevPAR growth
and we completed a series of initiatives that significantly strengthened
our financial position, streamlined our corporate structure and sharpened
our business focus. Most visibly, we realigned our capital structure and
de-leveraged our balance sheet, infusing $1 billion in new equity into
the Company. We closed on $2.5 billion in new corporate debt, repaid $336
million in forward equity commitments, and completed $581 million in mortgage
financing. Over the next 18 months, we have less than $180 million in principal
payments.�
Last month, Wyndham named Fred J. Kleisner to the position of President
and Chief Operating Officer. Kleisner, 54, joined Wyndham from Starwood
Hotels Resorts Worldwide, Inc., where he was President of the Americas
division. In May, Wyndham named Richard Mahoney, 46, Chief Financial Officer.
A former CFO of Westin Hotels Resorts, Mahoney joined Wyndham from
Starwood Hotels Resorts, where he was Executive Vice President and
Chief Operating Officer of its gaming division.
Carreker added, �In addition to building our management team, we continued
to build equity in our proprietary brands, opening three flagship hotels
in key downtown markets (Chicago, Atlanta and Boston). We also introduced
the new prototype for our suburban product, The Wyndham Hotel in Billerica,
MA.�
Second Quarter Operating Performance
The Company�s total owned hotels generated a 2% RevPAR increase in the
quarter and 2.7% year to date, as compared with an industry average of
2.5% for the six first months.
Performance was supported by a 3.3% gain in proprietary branded hotels
for the quarter and 4.5% year to date. RevPAR for non-proprietary branded
hotels rose 0.5% and 0.6% for the quarter and year to date, respectively,
largely reflecting the significant number of hotels in transition following
the Interstate spin-off and other asset dispositions. Gross operating profit
(GOP) margin of owned assets increased to 35.7% from 35.4% of revenues.
Wyndham said the performance of its core upscale brands continues to
be strong. RevPAR for Wyndham Hotels Resorts rose 7.6% in the second
quarter to $96.73. The Summerfield Suites division achieved a 4.6% RevPAR
gain to $91.77. Grand Bay, the luxury division, posted a 3.2% gain in RevPAR
in the period - a significant improvement from its performance in the two
previous quarters. The Wyndham brand increased its GOP margin to 35.3%
from 34.3% of revenues.
Fred Kleisner, President and Chief Operating Officer, said, �I continue
to be impressed by the Wyndham organization - its brands, its assets, and
most importantly its people, who share an unstoppable drive to create long
term shareholder value. With our financial situation stabilized, our mission
is to realize the full potential of Wyndham International, building on
the tremendous equity and momentum of its outstanding portfolio of brands.�
Six Months Performance
For the first half, Wyndham reported EBITDA as adjusted of $354.8 million,
compared with $261.2 million for the comparable 1998 period. Revenues were
$1.3 billion in the 1999 first half, up from $815.3 million in the prior
year.
For the six months, Wyndham reported a net loss of $876.7 million, including
$907.5 million of largely non-cash, non-recurring charges related principally
to the items noted above for the second quarter.
Branded
Hotel Performance
Six Months Ended June 30,
|
1999
|
1998
|
% Chg
|
Wyndham - Total Brand |
|
|
|
Average Daily Rate |
$122.93 |
$116.89 |
5.2% |
Occupancy |
71.7% |
72.0% |
-0.3ppt |
RevPAR |
$88.15 |
$84.17 |
4.7% |
GOP Margin |
37.4% |
36.6% |
0.8ppt |
Wyndham Hotels Resorts (a) |
|
|
|
Average Daily Rate |
$142.29 |
$134.41 |
5.9% |
Occupancy |
74.3% |
73.5% |
0.8ppt |
RevPAR |
$105.78 |
$98.80 |
7.1% |
Wyndham Garden Hotels |
|
|
|
Average Daily Rate |
$94.13 |
$91.57 |
2.8% |
Occupancy |
68.9% |
71.1% |
-2.2ppt |
RevPAR |
$64.82 |
$65.12 |
-0.5% |
Grand Bay |
|
|
|
Average Daily Rate |
$311.91 |
$311.21 |
0.2% |
Occupancy |
71.4% |
72.1% |
-0.7ppt |
RevPAR |
$222.61 |
$224.25 |
-0.7% |
Summerfield Suites |
|
|
|
Average Daily Rate |
$112.97 |
$109.99 |
2.7% |
Occupancy |
79.6% |
79.7% |
-0.1ppt |
RevPAR |
$89.88 |
$87.70 |
2.5% |
Grand Heritage / Arcadian Hotels |
|
|
|
Average Daily Rate |
$119.22 |
$112.22 |
6.2% |
Occupancy |
59.0% |
58.3% |
0.7ppt |
RevPAR |
$70.37 |
$65.42 |
7.6% |
Owned
Hotel Performance
Six Months Ended June 30,
|
1999
|
1998
|
% Change
|
All Owned Hotels (b) |
|
|
|
Average Daily Rate |
$118.80 |
$114.47 |
3.8% |
Occupancy |
71.8% |
72.6% |
-0.8ppt |
RevPAR |
$85.30 |
$83.07 |
2.7% |
GOP Margin |
37.0% |
36.3% |
0.7ppt |
Proprietary Branded Owned Hotels |
|
|
|
Average Daily Rate |
$136.62 |
$129.88 |
5.2% |
Occupancy |
72.0% |
72.5% |
-0.5ppt |
RevPAR |
$98.41 |
$94.14 |
4.5% |
Non-Proprietary Branded Owned Hotels |
|
|
|
Average Daily Rate |
$104.98 |
$102.87 |
2.1% |
Occupancy |
71.6% |
72.6% |
-1.0ppt |
RevPAR |
$75.19 |
$74.73 |
0.6% |
Note: Brand statistics are based on comparable hotels operated
by the Company for both quarters.
(a) Includes Wyndham Hotels, Wyndham Resorts and Wyndham
Historic Hotels which Smith Travel (STR) classifies as the Upper Upscale
chain segment. STR classifes Wyndham Garden as an Upscale chain.
(b) Total owned statistics for all hotels owned as of
6/30/99 excluding seven hotels that have been sold.
Rights Offering
As previously disclosed, the Company intends to conduct a $300 million
rights offering. The Company intends to file a registration statement with
the SEC for the rights offering within the next few days. Commencement
of the rights offering is subject to finalizing the settlement of certain
litigation, court approval of the settlement, and effectiveness of the
registration statement.
About Wyndham International
Wyndham International, Inc. ranks among the largest branded hotel companies
in the United States. It owns, leases, manages and franchises primarily
upscale and luxury hotels representing a combined portfolio of 318 properties
with a total of more than 74,000 rooms in 38 states as well as Canada,
the Caribbean and Europe.
Cautionary Statement
This press release is not an offer to sell securities
and is not a solicitation of an offer to buy securities. The rights offering
will be made only by means of a prospectus filed with and declared effective
by the Securities and Exchange Commission. This press release contains
certain forward-looking statements within the meaning of Sections 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. The Company�s results could differ materially from those set forth
in the forward-looking statements. Certain factors that might cause a difference
include, but are not limited to, risks associated with the availability
of equity or debt financing at terms and conditions favorable to Wyndham,
risks associated with the course of litigation, Wyndham�s ability to effect
sales of assets on favorable terms and conditions; risks associated with
the hotel industry and real estate markets in general; and risk associated
with debt financing. |